Commentary and analysis on markets, personal finance, and wealth building from a contrarian perspective. "I believe in the discipline of mastering the best that other people have ever figured out. I don’t believe in just sitting there and trying to dream it up all yourself. Nobody’s that smart."
— Charlie Munger

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Saturday, October 31, 2015

Indian air conditioning demand exploding

India is already shaping up to be a huge consumer of air
conditioning. The number of cooling degree days when temperatures exceed the
human comfort level is already much larger in India’s four largest cities than
in Miami or Los Angeles, America’s two hottest cities. Moreover, these four
cities have much larger populations. Only 2 percent of Indian households now
have air conditioning whereas 87 percent of American households do. However,
air conditioning is one of the biggest consumer items of India’s rising middle
class and sales are increasing by 20 percent per year. There are now 25 million
total units in the country. The load is already putting a strain on the
electric grid. During the summer of 2012 there were blackouts lasting 16 hours
a day and 600 million people were without power. The government is seeking to
impose efficiency standards on air conditioning units that will cut electrical
consumption by 14 percent.

This, among other reasons, is why I am so bullish on nuclear power long term. India along with many other countries in Asia and Africa have many decades of urbanization and modernization ahead of them. Once people have enough money to ensure that their dietary needs are sufficient they begin to spend money on other things to make their life more comfortable. These are the long term investable trends that exist for the informed investor.